With the Goods and Services Tax (GST) system having settled down, revenues remaining steady, and rates having been rationalised, tax experts across the board say the priority for the GST Council in its 57th meeting on October 8 should be on decisively easing the compliance burden for taxpayers. 

The GST Council will meet in New Delhi on October 8 for the first time after its meeting on September 3-4, 2025, when it had introduced wide-ranging rate and slab changes. Sources in the Ministry of Finance have confirmed that the meeting will not deliberate on GST rates and will instead focus on a five-pronged effort to reform the tax system and its administration. 

Tax analysts agree that this should be the priority of the Council.

Right time for reforms

The GST system turned nine years old on July 1, 2026. Through this time, the Council has met 56 times, has reformed the GST slabs, successfully implemented the 5-year compensation period to States, and the system has stabilised in terms of revenue.

“With high GST collections across the past few months, the GST Council in its next meeting scheduled on October 8, would be able to decide on several issues faced by businesses including relaxation of input tax credit restrictions, reducing complaints for service providers, providing faster refunds, etc, without being unduly worried about the impact of such measures on the GST collections,” MS Mani, Partner at Deloitte India, said.

The Hindu had reported on October 6 that the proposals by the Centre for the GST Council’s consideration would cover process reforms, structural reforms, ease of living and doing business, exports of services, and e-commerce. The final decisions will, however, be made clear only once the Council’s meeting concludes. 

Several areas for improvement

“The most important process reforms will be allowing automatic and easy refunds especially to exporters, and preventing ITC accumulation, because these are economy wide effects on working capital for firms,” Rahul Ahluwalia, Founder Director of the Foundation for Economic Development said.

Prabhat Ranjan, Senior Director at Nexdigm, a business and tax consultancy, said that while rate rationalisation remains important, certainty of tax treatment can be as important as the rates themselves.  

“A significant hidden cost of GST arises from interpretational uncertainty — whether on classification, input tax credit, valuation, place of supply or procedural requirements,” Mr. Ranjan explained. “When the same transaction can invite different positions across jurisdictions, businesses face not merely additional tax exposure but litigation costs, provisioning requirements, working-capital blockage and uncertainty in commercial decision-making.”

Technology to the rescue

Brijesh Agrawal, CEO of Busy Infotech, a company specialising in GST-related software services, said that the GST back-end system has become technologically sophisticated but everyday compliance remains complex for business owners. 

“Key priorities should centre on consolidating tax slabs to a maximum of three [currently there are 6 slabs, including Zero/Nil, 0.25% and 3%], eliminating cess and overhauling Section 17(5) to allow unconditional credit on all verifiable business-to-business  expenses,” Mr. Agrawal said. 

At the moment, ordinary business costs are not entitled to input tax credits and so not only add to the costs of doing business but also potentially add to the price of the final product being sold. 

The Hindu has learnt that the Centre is proposing a change in this regard, to allow ordinary business costs to also be included in the ambit of input tax credits. 

Single registrations and audit

Another proposal that will be put up before the GST Council is to allow businesses to register in a single State and sell across the country instead of having to register their business in each of the States they want to sell in. 

Nitin Vijaivergia, Partner, Price Waterhouse & Co further said that the proposed system of harmonising GST audits across multiple registrations would significantly ease the compliance burden on large taxpayers. 

“A unified approach to issues that cuts across State lines would curb duplicative information requests and eliminate the risk of divergent conclusions on the same transaction,” Mr. Vijaivergia said. 

“It would also equip tax authorities to deploy data analytics and risk parameters with precision, directing scrutiny where genuine risk lies,” he added. “For businesses, the dividend is clear: greater consistency, enhanced predictability and a leaner audit-related compliance cost.”

Published – October 07, 2026 05:44 pm IST

India’s ambition to become a Viksit Bharat requires an economy in which enterprises of every size can grow, wherever they begin. Over the past 12 years, our government has worked to create those conditions. The introduction of the Goods and Services Tax (GST) in 2017 established a common national framework for indirect taxation. Next-Gen GST carries that effort forward, drawing on nine years of implementation and the experience of taxpayers and States.

Under Prime Minister Narendra Modi’s vision, Next-Gen GST was conceived with two connected purposes: to reduce and rationalise rates, and to make compliance easier. The rate changes took effect on September 22, 2025. The next phase of process reforms will come before the GST Council shortly. Together, these efforts seek to give households relief, businesses greater certainty and taxpayers a system in which they can fulfil their obligations without avoidable difficulty.

The States have been partners throughout. They brought their priorities and experience to the Council, helped shape the decisions and undertook their implementation. I thank them for that commitment. GST’s progress rests on this willingness to pursue a shared national purpose while respecting each government’s responsibilities.

The results provide grounds for confidence. Between October 2025 and July 2026, the value of reported taxable supplies grew by 25.8% over the corresponding period a year earlier. A lighter rate structure has been accompanied by a substantial expansion in reported economic activity. This is an encouraging foundation for a reform intended to support both enterprise and public finances.

That resilience is visible in the latest revenue figures. Gross GST collections reached ₹12.46 lakh crore during the April–September 2026 period, up 11.6% over the corresponding period last year. Every month from June through September recorded double-digit annual growth; together, collections for these four months accelerated by nearly 15%. Net collections, after refunds, also grew by 10.4% over the half-year. Taxpayer relief has coexisted with growth in the resources available for development.

The breadth of the expansion matters as much as its scale. Reported taxable supplies grew across all 11 sector groups and all major States. In an economy as diverse as India’s, this spread is significant. Growth across sectors and regions creates opportunities for more businesses to participate in expanding markets, and for more communities to benefit from the demand, investment and employment that follow.

Reported sales to consumers (B2C) also rose by 26.7% in the post-reform comparison. When tax relief is reflected in prices, families have more room to meet other needs or save. Consumer relief and enterprise growth are closely connected: the purchasing power of households sustains demand for the goods and services that businesses provide. The benefits can extend from the household to the retailer, the supplier and the producer.

For small and medium enterprises, a national market is valuable when it opens a practical route to customers beyond their immediate surroundings. Businesses in Tier-2 and Tier-3 towns should be able to build those relationships while continuing to invest and employ people locally. Enterprises expanding into these towns, in turn, can create opportunities for local suppliers and distributors. GST’s common framework supports these connections; simpler administration must make them easier to sustain.

Participation in that framework is substantial. GST registrations across Central and State jurisdictions stood at approximately 1.71 crore at the end of August, up nearly 15% from a year ago. For the April–July 2026 tax periods, GSTR-3B returns filed by their due dates were 12.6% higher than for the same periods last year. These improvements place a corresponding responsibility on the administration: regular compliance must be supported by reliable service, clear guidance and timely resolution of difficulties.

The functioning of input tax credit is another important part of this experience. The post-reform figures show that the share of tax liability discharged through credits rose, while accumulated credit declined relative to taxable supplies. This is encouraging for businesses that depend on the effective use of eligible credit. For a smaller firm, working capital determines how readily it can purchase inputs, fulfil an order and take on the next one.

Refunds are equally relevant. Approximately ₹1.80 lakh crore was refunded during April–September. Returning amounts due to businesses is part of a well-functioning tax system. Greater predictability in this process would help enterprises plan purchases and production with more confidence. The taxpayer’s experience of receiving an eligible refund is an important measure of administrative performance.

The States also have a stronger revenue position. Their aggregate SGST receipts, including their share of IGST settlements, grew by about 16% during April–September this year. These resources support investment in infrastructure and public services, which improve the conditions in which families and enterprises pursue their aspirations. The gains can therefore reinforce one another: household relief supports demand, enterprise strengthens economic activity, and public revenues help sustain development.

The experience also points to the work ahead. A growing system must remain attentive to the costs it imposes on smaller participants. Their time and resources are limited. Each improvement in filing, credit or refunds should allow more of those resources to be devoted to running and expanding a business.

The proposals before the Council on 7 October have been developed through sustained work with the States. They address registration, returns, refunds, disputes and improved flow of input tax credit, with the aim of reducing the time and cost of compliance. Taxpayer experience must continue to guide implementation.

GST’s growing maturity gives us a stronger foundation for the next stage of reform. The same commitment to clarity, certainty and respect for the taxpayer guides our work on direct taxes. A dependable tax system enables enterprises to plan beyond their immediate obligations and invest in opportunities that take time to mature. Giving them that confidence, wherever they operate, helps build the economic strength of a Viksit Bharat as envisioned by Prime Minister Narendra Modi.

Nirmala Sitharaman is Union Minister of Finance& Corporate Affairs, Government of India

Published – October 05, 2026 05:24 am IST

Gross CGST revenue during the month stood at ₹39,835 crore, while SGST and Integrated GST mop-up were ₹47,881 crore and more than ₹1.23 lakh crore, respectively. File
| Photo Credit: Getty Images/iStockphoto

After adjusting refunds, net GST mop-up was up 7.3% to about ₹2.11 lakh crore.
| Photo Credit: Getty Images/iStockphoto

Amidst the GST led momentum and quarterly earnings season, the focus on January Auto sales gets diverted, but automakers are expected to report a strong show. While GST rate cuts was a key trigger for buyers who have been on the sidelines for a while now, we now understand this is a structural change and dealer channel check suggest the same.

Brokerages also have put strong estimates for the month of January and suggest multiple winners this time around as well, a trend we have seen in the past couple of months as well. Among some key winners and gainers, Tata Motors, TVS, Ashok Leyland will be some you have to watch out for.

Two Wheelers: Affordability And Premiumization Trends Further Underpin Demand

Two wheeler demand especially for the entry level segment was on the sidelines pre GST Rate cuts led by cost increases over last few years. Growth trend has been quite strong in January with Hero being a key beneficiary. Trend seems structural and positive for the industry. Premiumization across category has been visible but not as stark as within two wheelers where beneficiaries have been across players.

TVS being the most diverisified player across motorcycles and scooters is expected to show a 26% year-on-year growth followed by Eicher Motors. According to brokerage firm Nuvama, exports would increase in double digits led by growth in Asia, Africa and Latin America, a trend benefitting Royal Enfield maker Eicher Motors, Bajaj and TVS.

PV: New Model Launches Take Centre Stage

After almost a year of no new model launches from end of 2024 till August 2025, carmakers have had their say in the last few months. Tata Sierra, Mahindra 9S & XUV 7XO, New Renault Duster, Hyundai Venue, Maruti Victoris have shown as bright as the Diwali lights and captured both buyer interest and healthy booking numbers.

Sierra push is expected to help Tata Motors outperform peers with 27% year on year growth, others are expected to show growth as well.

CV: Early Stages Of The Start Of An Upcycle

While there aren’t any signs of a upcycle starting already in truck sales, the numbers would show you otherwise, especially in the last quarter. While there hasn’t been a big capex push from the government which is a key indicator for increase in truck sales, monthly numbers seem to suggest GST benefit has helped truck sales as well, especially for Light Commercial Vehicles. This has helped stock prices of Ashok Leyland and Tata Motors Ltd, with 39% and 40% up respectively.

Once there is an indication and quarterly earnings conference calls will help with those, you could see the MHCV or Medium And Heavy Commercial Vehicles sales pick up meaningfully as well for truck makers. Expect a 20% growth for January across players.

Tractors: GST Cuts, Progress Tnto Rabi Season To Continue Growth Momentum

Tractor makers had their say in 2025 crossing the 1 million sale mark for the first time in a year and 2026 is expected to be a strong start yet again. Momentum is expected to continue with 15-20% YoY growth for Escorts and Mahindra.

Brokerage firm Nomura suggests that tractor demand sentiment continues to be strong, supported by GST cuts and demand will remain healthy for the rest of the year as we progress into the rabi season, supported by improved reservoir levels, and better farm cash flow.

ALSO READ: Tata Motors, Hyundai And Other Auto Stocks In Focus As India Mulls Tariff Cut For EU Carmakers

Gross Goods and Services Tax mop-up was ₹1.73 lakh crore in September 2024. Last month, the collection was ₹1.86 lakh crore, as per government data released. File.
| Photo Credit: Reuters

Finance Minister Nirmala Sitharaman. File.
| Photo Credit: Bijoy Ghosh

At the 56th meeting of GST Council meeting, the current four-tier structure has been replaced with a two-tier one, with a standard rate of 18% and five per cent, and de-merit rate of 40% on selected few goods and services.
| Photo Credit: Getty Images

Representative image
| Photo Credit: Reuters

Jaisalmer (Rajasthan):

Union Finance Minister Nirmala Sitharaman on Saturday announced that the Goods and Services Tax Council has approved the reduction of GST on rice kernels to 5 per cent, exempted life-saving gene therapy from tax, and extended the GST exemption for parts used in manufacturing surface-to-air missiles (SAM).

Addressing the media here after the 55th GST Council meeting, the Finance Minister said the decision to cut GST on rice kernels from 18 per cent to 5 per cent has been taken as the commodity is supplied to the weaker sections of society through the public distribution system.

“Similarly, the concessional 5 per cent GST is applicable on inputs of food preparations that are supplied for free distribution to economically weaker sections under government programs subject to existing conditions; so this is also an extension of the 5 per cent rate that prevails,” she said.

Explaining the rationale for increasing the tax on caramelised popcorn to 18 per cent, the Finance Minister said that these included added sugar which constituted a separate category just like carbonated drinks that are harmful to health and hence, are put under a higher tax slab.

She pointed out that salted and plain popcorn were also being sold in the market and the GST on them had not been increased.

She further stated that black pepper, whether fresh green or black pepper or dried black pepper, and raisins, when supplied by an agriculturist, are not liable to GST. However, if these commodities are sold by merchants, then they would be liable to pay tax.

She also said that all parts used for the manufacture of SAM missiles including software will continue to be exempt from GST.

The Finance Minister also said that while payment aggregators handling transactions below Rs 2,000 are eligible for exemptions, this does not apply to payment gateways and fintech services.

She said that no GST is payable on penal charges or levies collected by banks and NBFCs for non-compliance with loan terms by borrowers. This step would go a long way to help small businesses.

The Finance Minister further stated that the issue of whether there should be a separate GST on delivery charges of food provided by quick commerce companies and e-commerce apps was discussed at the meeting but no decision has been taken in the matter. It was felt by the Council that more detailed discussions were required on the issue, she added.

The Finance Minister also said that ACC blocks containing more than 50 per cent fly ash will attract 12 per cent GST.

Ms Sitharaman disclosed that no decision has been made regarding the inclusion of Aviation Turbine Fuel (ATF) under the GST framework as several states were opposed to the move. Further discussions are expected on the issue in future meetings.

She further stated that the GoM on health insurance has not received inputs from the insurance regulator IRDAI as yet so more time is required to take a decision on the issue.

The GoM on rate rationalisation also needs additional time as the report is yet to be finalised, she added.

The Finance Minister further said that the Council discussed whether the GST on floor space index (FSI) for construction should be on the reverse charge or forward charge. No decision was taken on the issue as it has implications for the revenue of municipalities and besides, land is a state subject.

She also disclosed that a concept note has been given in-principle approval by the GST Council to bring amendments in GST to make registration easier for small companies who avail low input tax credit. These companies are facing problems in registrations and it has been decided to simplify the system to make the process smoother for them.

The Council has approved an amendment to the definition of prepackaged and labelled items intended for retail sale. The step is aimed at clarifying the definition for all goods as currently there is a lot of confusion on the issue, Ms Sitharaman added.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)